Electric vehicle manufacturing start up Fisker is set to become a publicly listed company through combination with Spartan Energy Acquisition, a special purpose acquisition firm backed by an affiliate of Apollo Global Management.

The deal values the start up at $2.9bn.

Fisker founder, chairman and CEO Henrik Fisker said: “Today, the realisation of the world’s first digital car company took another major step forward, advancing our mission to commercialise the world’s most emotional and sustainable vehicles, while upholding our vision of a clean future for all.

“We are excited to partner with Apollo, a world-class financial institution who brings deep industry expertise, extensive global relationships and a shared commitment to ESG.

“This vote of confidence from investors, coupled with our exciting progress on the development of our first vehicle, lays out Fisker’s path to 2022 and beyond.”

Based in Los Angeles, Fisker focuses on developing eco-friendly electric vehicles.

The proposed transaction will provide the company with more than $1bn of gross proceeds, including $500m of funds from existing and new investors. Fisker will use the proceeds to bring its first product, the Fisker Ocean, to production in late 2022.

Henrik Fisker added: “Our funding, product plans and brand development actions are on course.

“Prototype vehicles are expected to start durability testing by the end of this year, and we continue to make significant progress on the development of our sales and service proposition.”

The merger is expected to close in the fourth quarter of this year, subject to customary closing conditions, including the approval by Spartan’s shareholders among others.